Week 3

Part A: Measurement Process

• Accounting Cycle
  • During the Year
    • Record & Post external transactions
  • End of the Year
    • Record & post adjusting entries
    • prepare financial statements
    • record & post closing entries
• Cash-Basis Accounting (并非这个课要做的)
  • Under cash-basis accounting, we record transactions only at the time cash is received or paid.
• Accrual-Basis (权责发生制) Accounting (Part of GAAP)
  • Assets – at the time those resources are obtained.
  • Liabilities – at the time those obligations occur.
  • Revenues – at the time goods and services are provided to customers.
  • Expenses – at the time costs are used in running the company
  • assets, liabilities, revenues, and expenses are recorded as they occur (the cost is used, the services is provided)
• Adjusting Entries
  • Asset -> Expenses
  • Liablities -> Revenue
• Prepaid Expense
  • Rent
  • Supplies
  • Depreciable Assets (Equipment)
    • 不能直接 debit 一个equipment
    • book value: 这个东西还剩的价值
• Deferred Revenues
  • 已收钱但还未提供的服务
• Accured Expenses (L)
  • 使用了但是没有付钱
  • Debit Expense, Credit Payable
  • Salaries
  • Utilities
  • Interest (借钱利润)
• Closing Entries
  • 整合?

Tutorial Common Stock & Liability